Why was an email received from CDSL stating UCC is delinked from the demat account?

A circular issued by SEBI (WEB) that mandates the mapping of a client's Unique Client Code (UCC), with which they open an account with a broker, and their demat account number (BO ID) is the reason behind the email. The purpose of this requirement is to establish systematic checks. To learn more about client code and BO ID, see What is the user ID to log in to Zerodha’s trading platform? And What are DP name, DP ID, BO ID and demat ID?

The mapping enables regulators to ensure that shares sold by a client are debited from their account and shares purchased by the client are credited to their account. The mapping occurs between the UCC, demat account, trading member ID (broker ID), clearing member ID, and account segments. Therefore, if a Zerodha trading and demat account is opened, the mapping occurs on the back-end (backend of exchange {NSE and BSE} + depository {CDSL} clearing corporation {NCL}).

The Zerodha Client ID is mapped with the following:

• Zerodha demat account number.
• Zerodha's trading member ID with the exchange.
• Zerodha's clearing member ID with the clearing corporation.
• Segments that are enabled in the account (NSE, BSE, NFO, CDS, etc.).

All client IDs with different brokers get mapped to all the demat accounts that have been opened. If a client has multiple trading accounts with different brokers, their demat account at Zerodha will be mapped to all the unique client codes. For example, if a client has 5 trading accounts (including Zerodha) with 5 stockbrokers, the demat account at Zerodha will be mapped to 5 different Unique Client Codes.

The mapping between the UCC and the demat account changes based on the status of the UCC. If a broker changes the status of the UCC from Active to Inactive or Closed, the UCC to demat linking gets unmapped or de-linked. In this case, one of the other brokers that the client has an account with has changed the status of their client ID from Active to Inactive at their end, resulting in the delinking of the UCC from the Zerodha demat account. CDSL sends an email to notify the client of the same.

The changes made by CDSL will not affect the trading activity with Zerodha, and the email can be ignored. CDSL will inform the client of the changes made to their system the next day. In the email, V stands for Verified and D for Delinked.